National culture and fraud risk: exploratory evidence

Dessalegn Getie Mihret

Journal of Financial Reporting and Accounting, 2014, vol. 12, issue 2, 161-176

Abstract: Purpose - – The purpose of this paper is to test the association between national culture dimensions and exposure to fraud with a view to drawing implications for understanding fraud risk. Design/methodology/approach - – The study is based on a sample of 66 countries. Regression analysis is conducted using Hofstede’s national culture dimensions as independent variables and fraud risk as a dependent variable. Transparency International’s corruption index was used as a proxy for fraud risk. Findings - – Results suggest high fraud risk exposure in countries with high power distance and those having limited long-term orientations. Research limitations/implications - – The study informs deeper understanding of fraud risk through analysis of fraud risk in a culturally relative sense. Originality/value - – This is the first study (known to the author) to draw the implications of national culture for understanding fraud risk.

Keywords: Fraud; National culture; Fraud triangle; Fraud fighting; Fraud risk; Fraud theory (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jfrapp:v:12:y:2014:i:2:p:161-176

DOI: 10.1108/JFRA-10-2012-0049

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